President Tinubu’s VAT Exemption: A Bold Step Toward Economic Growth.

By Oluwatobi Adeleke, Social Media Coordinator, PROFESSOR ADEMOLA OJO EMMANUEL FOUNDATION

President Tinubu’s decision to implement VAT exemptions on rents, public transportation, and renewable energy represents a pivotal step towards driving economic growth and fostering sustainable development in Nigeria.

In a landmark announcement, President Bola Tinubu declared that rents, public transportation, and renewable energy will be fully exempt from Value Added Tax (VAT). This policy shift is expected to profoundly impact Nigeria’s economic landscape, fostering growth, reducing financial burdens, and accelerating development across multiple sectors.

The VAT exemption on rents makes housing more affordable for Nigerians and addresses the issue of housing shortages in urban areas. With reduced financial burdens on tenants, the demand for rental properties is likely to surge, prompting developers to invest in new housing projects and enhance the overall living conditions. This, in turn, has the potential to stimulate economic activity, create jobs in construction and related industries, and lead to improved infrastructure development.

The VAT exemption on public transportation is a significant move that will benefit both commuters and transport service providers. Lower operating costs for providers can translate into more competitive fares for passengers, improving access to affordable and efficient transportation services. This measure can enhance mobility, boost productivity, and facilitate business activities by streamlining the movement of goods and services across cities, thereby contributing to economic growth and urban development.

Moreover, the VAT exemption on renewable energy is a game-changer that promotes environmental sustainability and reduces the country’s reliance on fossil fuels. By incentivising the use of clean energy sources such as solar and wind power, the government is not only creating opportunities for investment in the renewable energy sector but also contributing to the reduction of greenhouse gas emissions and environmental degradation. This shift towards cleaner and renewable energy sources aligns with global efforts to combat climate change and positions Nigeria as a leader in sustainable development.

President Tinubu’s visionary economic reforms align with the overarching goal of modernising the economy, promoting innovation, and ensuring long-term economic stability. The VAT exemptions are expected to drive investment, boost consumer spending, and create new job opportunities in emerging sectors such as renewable energy, thereby fostering inclusive growth and economic diversification. This forward-looking approach underscores the government’s commitment to building a more resilient and prosperous Nigeria for present and future generations.

In conclusion, President Tinubu’s VAT exemption policy represents a transformative initiative that has the potential to reshape Nigeria’s economic landscape, catalyse growth, and steer the country towards a more sustainable and resilient future. By prioritising affordability, accessibility, and sustainability, these bold reforms set the stage for a dynamic and inclusive economy that benefits all segments of society and positions Nigeria as a key player in the global economy.